Exxon to continue exploring Makassar Strait

US-based oil and gas company Exxon Mobil through its local subsidiary plans to continue exploring the deep water sea in Makassar Strait in a bid to find petroleum reserves. The company conducted exploration last year, but not yielding a significant discovery, Jakarta Globe reported, citing a company executive.

Exxon Mobil Indonesia operates two blocks in Makassar Strait: Surumana block, for which a contract was signed in September 2006, and Mandar block, which was secured in 2007.

Exxon joined forces with Malaysian oil and gas company Petronas Carigali in developing both blocks, with Exxon owning 80 percent.

Asep Sulaeman, a senior vice president at Exxon Mobil Indonesia, said on Tuesday that last year Exxon drilled four wells in the strait, but so far there has not been discovered any reserves of sufficiently economical size, he said.

Asep explained that the whole endeavour being a deep seawater exploration of more than 2,000 meters water depth is considered high risk and costly. The cost to drill a single well runs around $90 million to $100 million.

?It is risky, but we believe there is a big prospect there. We will evaluate and note the lessons learned over what we have done,? Asep said.

Apart from carrying out the exploration project in Makassar Strait, Exxon is also exploring an offshore area in Papua in conjunction with Niko Resources, a Canadian company. Currently Exxon is performing geological exploration in the area. (*)